Full Retirement Age to be 67 in 2025

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IRS Issues Reminder for Retirement Plan Withdrawals

Social Security Increases Full Retirement Age to 67 by 2025.

 

People considering retiring better check their birth certificate. The full retirement age has gradually increased by two months each year since 1983. For individuals born in 1958, it is 66 years and 8 months. By 2025, it will reach 67 years for those born in 1960 or later. Full details on retirement benefits and eligibility can be found on the Social Security Administration (SSA)website. You can start receiving your Social Security retirement benefits as early as age 62. However, you are entitled to full benefits only when you reach your full retirement age. If you delay taking your benefits from your full retirement age up to age 70, your benefit amount will increase.

The age at which workers become eligible for 100 percent of their retirement benefits was 65 for many decades, but in 1983 that threshold was adjusted to incrementally raise the age to match the growing expected lifespan. While those aged 62 can already begin collecting some retirement benefits, taxpayers cannot receive 100 percent of their lifetime earnings until they reach full retirement age. Those who don’t apply for benefits until after that full retirement age can also get a form of backpay or delayed retirement credits that increase monthly payments.

There are advantages and disadvantages to taking your benefit before your full retirement age. The advantage is that you collect benefits for a longer period of time. The disadvantage is your benefit will be reduced.

On the flip side, a modest cost-of-living adjustment of 2.5 percent will also take effect beginning in January 2025. This will boost retirement benefits by about $50 a month. The adjustment is based on inflation as reported by the Consumer Price Index. In Illinois, more than 1.7 million retired residents were collecting social security benefits in 2023, according to the SSA.